Solar Energy Legislation 2015/2016

January 4, 2016

Solar Energy Legislation 2015/2016
Climate Action Now and its allies support the House in attempting to act on solar energy in 2015
prior to taking up a more complex omnibus energy bill in 2016.
However, H.3854 as written would impede progress in reducing global warming emissions by
restricting the growth of solar, and would weaken the solar industry, resulting in a loss of jobs
and tax revenue.
Therefore we ask legislators to carefully consider the following points and to notify the
conference committee – Representatives Dempsey, Golden, and Brad Jones; Senators
Downing, Tarr and Pacheco; as well as Speaker DeLeo and Senate President Rosenberg of the
need to incorporate these changes to the final compromise.
1. Eliminate the cap on solar energy net metering*.
Rationale: Already the existing cap is having an adverse impact on 171 affected communities
by preventing them from saving on their electricity costs, and the state is losing jobs and tax
revenue by reining in the solar industry. Raising the cap slightly (by the proposed 2% in H.
3854) will only allow a portion of planned projects to be completed before the new cap is
reached, likely in six months. At that point, new legislation would be required to raise the cap
yet again.
Eliminating the cap would give solar businesses the long-term assurance they need to maintain
and grow their workforce, providing jobs and tax revenue. It would also enable municipalities to
pursue solar arrays to achieve their greenhouse gas reduction goals and cost savings, and
encourage low-income and community shared solar projects, helping expand renewable energy
in an equitable manner.
2. Maintain the current retail reimbursement rate for net metering until comprehensive
study of the issue is completed.
Rationale: Slashing the reimbursement rate from retail to wholesale for sizeable arrays will
make them less likely to be built, as the return on investment will be drastically reduced. H.3854
cuts the reimbursement rate by 75%. Municipal, low-income and shared community arrays
require the retail reimbursement rate for financial viability. If a cut in the cost of solar to utilities is
found to be necessary (see point 5 below), the Solar Renewable Energy Credit (SREC**)
incentive program can be modified without harming municipal low-income, or community solar
projects (see point 6 below).
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3. Do not allow utility companies to impose a mandatory monthly minimum charge as
stipulated in H.3854.
Rationale: Mandatory minimum charges would discourage energy conservation by raising costs
for low-energy users, and discourage investment in solar arrays. As worded, H.3854 could
result in annual minimum charges of $360 for residential solar customers and significantly
higher bills for businesses and municipalities, negating much of their investment in solar. If any
such charge is considered, it should be informed by an actual study of the benefits and costs of
solar energy, and limited to a reasonable fee.
4. Grandfather all solar projects so that their reimbursement rate remains as agreed
upon when they were built.
Rationale: Transitioning to lower reimbursement mid-stream (in 20 years as stipulated in
H.3854) fails to honor agreements made when project costs were calculated, undermining
confidence in doing business in Massachusetts. This would have a chilling effect on new
projects that require long-term payback.
5. Initiate a transparent process to study the actual costs and benefits of solar to guide
long-term policy.
Rationale: The inaccurate and misleading claims of the utility industry about the cost of solar
need to be independently evaluated. The considerable benefits of solar must be factored into
the equation. Prior analyses have shown that the actual benefits of solar outweigh its costs, for
example by eliminating the need for more power plants, reducing pollution from burning fossil
fuels and offering protection from unpredictable fluctuation in the price of fossil fuels.
6. Reform the SREC** program to lower ratepayer costs
Rationale: The SREC program accounts for the majority of solar costs to utilities and can be
reduced without tinkering with the proven worth of net metering reimbursement. Adjusting the
SREC program would be more equitable for low-income communities that are not eligible for
SRECs but depend on net metering reimbursement, and for other solar users who do not own
their arrays. The Dep’t of Energy Resources (DOER) can examine and adjust the SREC
program.
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*Solar net metering refers to the program that reimburses solar customers for the excess power
they generate and provide to the grid.
**Solar Renewable Energy Credits (SRECs) provide cash benefits to solar owners who sell
credits from their arrays on the market administered by the Department of Energy